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Old 19th February 2021, 20:33   #76
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Default Re: Regular petrol hits a century for the first-ever time in India

In May 2014, petrol was Rs 71/litre, and crude was around Rs 6634/barrel. Today, petrol is Rs 100/litre and crude is Rs 4440/ barrel. (Iíve taken indicative prices, not the Indian basket which may vary based on mix, forward purchases, exchange rates, Iran etc).

Clearly Nehrus fault!
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Old 19th February 2021, 20:33   #77
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Default Re: Regular petrol hits a century for the first-ever time in India

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Originally Posted by v1p3r View Post
I've made this easier by comparing PPP income and fuel price in USD per litre. The ratio that comes out at the end is enlightening. I've not included the Netherlands but there are a few developed countries in there, to show you how our wallets and fuel tanks are being violated.

Yes Excel is my idea of fun.
Very interesting. The PPP income data you’ve chosen seems to be the GDP per capita (PPP) rather than the average income (PPP adjusted). Both are somewhat co-related, so it does give an indication on how Indians disproportionately pay more for fuel, especially given how cheap everything else is in India (even compared to other developing countries).

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In May 2014, petrol was Rs 71/litre, and crude was around Rs 6634/barrel. Today, petrol is Rs 100/litre and crude is Rs 4440/ barrel. (I’ve taken indicative prices, not the Indian basket which may vary based on mix, forward purchases, exchange rates, Iran etc).

Clearly Nehrus fault!
It’s a meme festival out there! The jokes deserve another thread in itself (preferably as apolitical as possible in keeping with the T-BHP ethos).

Last edited by dragracer567 : 19th February 2021 at 20:36.
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Old 19th February 2021, 20:36   #78
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Default Re: Regular petrol hits a century for the first-ever time in India

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In addition, given the spread of wealth in India, I am not sure how relevant PPP is at all.
Fuel prices affect everyone, and they affect the poor disproportionately. It's like a basic consumption tax, something that has long been ruled out as poor people bear the burden. The truth in India is that a significant number of urban dwellers use either fuel-powered public transport or their own vehicles. Most are not rich - there are courier folks and delivery folks who pay for fuel from their own pocket. One example is Swiggy, the delivery app that is slated to become India's second largest employer soon. Also, the rising price of fuel is baked into each product or service consumed by anyone.

This sort of indiscriminate and punitive taxation will lead to a brain drain (as someone pointed out earlier). The 'best and brightest' will choose to go abroad and remain abroad instead of being subjected to the vagaries of governance that are now a feature of life here. Fuel price may not be a major factor in this, but it is one amongst many and possibly the last straw.
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Old 19th February 2021, 21:06   #79
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Default Re: Regular petrol hits a century for the first-ever time in India

The fossil fuels will continue to be the cash cows for the government, and, they will continue milking it. This is exactly why I think the EV craze will not be as successful in India like the west.At-least, for another decade.

To be recognized among the western countries that we are serious about our environment, there will be some quarter hearted attempts from the government(s) to showcase some environment concern, but they would never allow EVs to be mainstream. What else explains the sales of EVs by the dozens but not a single concrete EV charging infrastructure plan.

Back to the fuel price rise, all we can do is congratulate the government on achieving this important milestone (going by the logic of most politicos today).

Last edited by Gannu_1 : 19th February 2021 at 21:45. Reason: Removing [color] tags. Please type into the forum directly instead of using a word processor like MS Word. Thanks.
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Old 19th February 2021, 22:16   #80
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Default Re: Regular petrol hits a century for the first-ever time in India

This is a a result of a pathetic government policy to say the least! At least compare with the petrol prices with the fuel price in not so developed neighbouring countries or the fuel price vs crude oil comparison at present day, and the picture would be very clear if anyone is ready to accept the facts! And unlike other luxury commodities like electronic gadgets or car prices, the increase of the diesel price would have a direct & adverse impact on everyone in the society including the poor & middle class as surely everything from public transport fare to price of essential commodities including food grains would be increased which will have a huge blow on the COVID impacted economic condition. One doesn’t need to be an economic expert to understand it. But unfortunately in India, the government can gain vote or popularity among mass with activities not related to basic needs of the citizens, rather by pulling other not so important or even irrelevant emotional strings! Hence till the common sense for the betterment of own life prevails & push is given from common mass to the government, it would go on.
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Old 19th February 2021, 22:33   #81
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Default Re: Regular petrol hits a century for the first-ever time in India

Amul has joined the fun

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Old 19th February 2021, 22:41   #82
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Default Re: Regular petrol hits a century for the first-ever time in India

Plain & simple truth - the govt needs more money in its coffers to cater for the annual farm loans waive off, infrastructure projects, welfare schemes, compensate for the gst shortfall due to Covid, continue bailing out Air India & so on & so forth. We are a nation of 1.3 billion who have to be provided for by the government. It needs money for that.
Yes, this hits some businesses particularly hard. But its better that everybody is sharing the burden rather than just the tax paying class.
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Old 19th February 2021, 22:47   #83
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Default Re: Regular petrol hits a century for the first-ever time in India

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Have you guys not heard of Oil bonds or making a one sided argument deliberately? Previous govt issued Oil bonds of 15-20 year tenure worth more than 1.5 Lakh crores. PSU banks and OMCs were asked to absorb a similar amount in losses as fuel subsidies. Being great economists, they also made it such that interest payments on these bonds will come due in 2021 only and the accrued interest payments were never included in fiscal deficit at their time. This is not great economics, its just great financial engineering whose bill will come due very soon.

PS: Also those who compare USD price of Oil and INR pice of pump, please also add exchange rate in your calculations.
You my friend are also mislead. Although it increases the burden, the subsidies were soon done away with and excises were imposed by the same UPA govt (Congress). Currently, the Excise collections for this FY20 (2019-2020) were almost 2,40,000 Crores. They spend close to 12,500 crores annually on interest and bonds worth just north of 40000 crores are up for payment till 2024. So, UPA govt gave subsidies for many years and racked up a huge 1.5 lakh crore burden right? The current government is earning 160% of that just in excise duty yearly from fuel. The current government is hell bent on misleading the uninitiated public to blame everything to the older regime. The taxes are increased to control the fiscal deficit. Currently it hit 9.5% and they want to bring it down to 6.8%. It's nothing to do with the earlier govt, just to bring down deficit. But, blaming this on the previous government is a BS move. After all, you earn more excise on fuel than all the bills they racked up after years of subsidies instead of just paying it back or, keeping excise duties in line with meeting the expenses of the bonds they are heaving taxing it to increase their reciepts.

Ask anyone in the Finance field and 99/100 do not like the current government.
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Old 19th February 2021, 22:54   #84
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While we are angry at ever increasing fuel prices , I believe this is being with an intention. The same intention will force some percent of market to opt for electric vehicles.
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Old 19th February 2021, 23:05   #85
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Default Re: Regular petrol hits a century for the first-ever time in India

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My State just forgave 12k crore farm loans without any assessement of merit just because the election is near.

The freebie receiving, lazy rural voter doesn't question how all this is funded. He's happy to vote for whoever gives the max. It's much easier for the politician to spend a week before election distributing the cash/gifts per vote than actually work 5 years. This is confirmed election after election where rural voting is at 75%+ while it is 50% for Urban India.
Disagreed. In fact, it was the Agriculture sector/Rural economy that helped during Covid crisis. 65% Population of India is Rural. And they contribute big time to economy through spending and Indirect taxes.

And one must know the share of direct Income tax in India Government earnings. Its been between 15% to low 20%. Rest comes from Indirect taxes and borrowing, which everyone pays.

By no means I am saying that Loans should be waived. But do you know share of Farmer Loans in overall NPAs? There has been far bigger Industrial NPAs. Check this out:
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Old 19th February 2021, 23:13   #86
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Default Re: Regular petrol hits a century for the first-ever time in India

For a long while now I have believed the excessive proliferation of these tin boxes called cars needs to be brought down/controlled. If the government is able to spend the same money towards building proper Public transport infrastructure (esp in urban centres) I don’t mind paying a little extra for fuel. That said, a lot of people/businesses on this thread have genuine concerns and I empathise with them
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Old 19th February 2021, 23:33   #87
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Default Re: Regular petrol hits a century for the first-ever time in India

IMHO the govt should tax fossil fuels more as long as the consumption is on an upward trend. Fossil fuels pollute. Renewable sources are the way to go. Diesel can be taxed a bit lesser so that the grocery prices don't become too high.

Last edited by Aditya : 20th February 2021 at 05:52. Reason: Political reference deleted
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Old 20th February 2021, 00:05   #88
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Default Re: Regular petrol hits a century for the first-ever time in India

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Originally Posted by superbad View Post
Plain & simple truth - the govt needs more money in its coffers to cater for the annual farm loans waive off, infrastructure projects, welfare schemes, compensate for the gst shortfall due to Covid, continue bailing out Air India & so on & so forth. We are a nation of 1.3 billion who have to be provided for by the government. It needs money for that.
Yes, this hits some businesses particularly hard. But its better that everybody is sharing the burden rather than just the tax paying class.
Its intriguing how 'Annual farm loan waiver' came in first in the list. Ground reality is that Farm Loans are only 9-13% of overall Bank NPAs. So it should be more of Industrial & commercial loan NPAs.
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Old 20th February 2021, 00:12   #89
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Default Re: Regular petrol hits a century for the first-ever time in India

Purely from a taxpayer perspective, I am all for this kind of taxing - on actual consumption. This way, the businessmen with multiple luxury cars (and negligible taxable income) , the 'poor farmers' (earning multiple lakhs/month) and saintly NGOs etc. all shell out their contribution.

Ideal state: Petrol at 200 bucks a liter, no income tax. Solves a lot of problems.

Last edited by tanayr : 20th February 2021 at 00:25.
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Old 20th February 2021, 00:56   #90
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Default Re: Regular petrol hits a century for the first-ever time in India

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Purely from a taxpayer perspective, I am all for this kind of taxing - on actual consumption. This way, the businessmen with multiple luxury cars (and negligible taxable income) , the 'poor farmers' (earning multiple lakhs/month) and saintly NGOs etc. all shell out their contribution.

Ideal state: Petrol at 200 bucks a liter, no income tax. Solves a lot of problems.
You already pay alot of taxes on EVERYTHING you consume. The government is too busy differentiating between roti and parontha to be bothered about the problems of a consumer. I researched on this sometime late last year, and we found out that someone earning about 50 lakhs a year ends up paying about 26-28 Lakhs of his income as taxes one way or the other.
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